Gold News

The technical picture right now

Consolidation aside, the long-term prognosis remains bright...

Gold Forecaster: Global Watch, 14th March 2007
Below is a snippet from the latest weekly issue from GoldForecaster.com

GOLD BROKE RESISTANCE at $675 and moved to nearly $700 before making a sizeable fall with the general markets recently.

   But with gold exceeding that key technical resistance before the correction, it has moved into a position so as to be ready to move much higher once this consolidation is over.

   This correction only puts a short-term dent on the move up, allowing those still to enter to get in below $650 before the market makes a move to and past the prior $730 record highs.

   Terrific support is seen in the low to $600s. The market is making higher highs and higher lows since the 2001 bottom around $250 per ounce. The next major upside objectives remain $730, then $850 followed by $1,000.

   As the market presents this pullback to us, we continue to view it is an opportunity. The weekly charts continue to project extreme bullishness and this pullback is a healthy period of consolidation before the next objectives higher!

   With the breakout past $676 to $692 and the violent fall back to $634, we received the expected bounce. We now need to go through a period of consolidation until a firm foundation is made for the move up, drifting higher before we can see a resumption of the rally to $730.

   $655-660 remains a good area of resistance; a close above this is needed to retarget $675-676 then $690-700. For now, good support is seen beneath current prices. Any purchases below $650 appear to offer quite a good risk/reward play short-term.

   $700 then $730 remain upside targets – and judging from the action over the past few months, the market is showing us that it is only a matter of time. If the market snaps back in the next week or two, then we will be in good shape. Otherwise a period of consolidation – as mentioned above – now appears to be most likely.

   Volatility has been quite high and will remain with us, although it may settle down from the levels observed in late February into early March.

   Pullbacks are very attractive at this time!

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JULIAN PHILLIPS – one half of the highly respected team at GoldForecaster.com – began his career in the financial markets back in 1970, when he left the British Army after serving as an Officer in the Light Infantry in Malaya, Mauritius, and Belfast.

First he worked in Timber Management and then joined the London Stock Exchange, qualifying as a member and specializing from the beginning in currencies, gold and the "Dollar Premium". On moving to South Africa, Julian was appointed a macro-economist for the Electricity Supply Commission – guiding currency decisions on the multi-billion foreign Loan Portfolio – before joining Chase Manhattan and the UK Merchant Bank, Hill Samuel, in Johannesburg.

There he specialized in gold, before moving to Capetown, where he established the Fund Management department of the Board of Executors. Julian returned to the "Gold World" over two years ago, contributing his exceptional experience and insights to Global Watch: The Gold Forecaster.

Legal Notice/Disclaimer: This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. Gold Forecaster/Julian D.W. Phillips have based this document on information obtained from sources they believe to be reliable but which it has not independently verified; they make no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. Expressions of opinion are those of Gold Forecaster/Julian D.W. Phillips only and are subject to change without notice. They assume no warranty, liability or guarantee for the current relevance, correctness or completeness of any information provided within this report and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission. Furthermore, they assume no liability for any direct or indirect loss or damage or, in particular, for lost profit, which you may incur as a result of the use and existence of the information, provided within this report.

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